Silver Spring, Maryland – Discovery Communications’ third quarter revenues of $1,556 million were flat compared to the prior year, as 2% growth at U.S. Networks and 19% growth at Education and Other were offset by a 3% decline at International Networks, primarily due to currency effects. Adjusted Operating Income Before Depreciation and Amortization decreased 2% to $562 million, as 3% growth at U.S. Networks was more than offset by a 16% decline at International Networks, partially due to currency effects. Excluding currency effects, total Company revenues and Adjusted OIBDA grew 3% and 1%, respectively.
Third quarter net income available to Discovery Communications, Inc. (“DCI Net Income”) decreased 22% to $219 million compared to $279 million for the third quarter of 2015, primarily due to a $50 million (or $0.08 per share) after-tax impairment charge related to the Lionsgate investment and higher equity-based compensation, partially offset by a decrease in taxes, currency-related transactional gains and higher contribution from equity investees income.
Diluted earnings per share decreased 16% to $0.36 due to lower DCI Net Income, partially offset by lower shares outstanding. Adjusted Earnings Per Diluted Share (“Adjusted EPS”), which excludes the impact of amortisation of acquisition-related intangible assets, decreased 15% to $0.40 for the third quarter 2016 compared to $0.47 for the third quarter 2015. Third quarter Adjusted EPS excluding currency effects decreased 14%.
Free cash flow increased 75% to $410 million for the third quarter of 2016 as cash flow from operations increased to $436 million while capital expenditures increased 8% to $26 million. Capital expenditures for the first nine months of 2016 decreased 9%. Third quarter cash flow from operations increased primarily due to lower cash taxes and the timing of working capital. Third quarter free cash flow excluding the impact of currency effects increased 112%. Free cash flow is defined as cash provided by operating activities fewer purchases of property and equipment.